Layoff plans might hit 170 at Ilikai

The move comes as renovations start at Yacht Harbor Tower

The Ilikai hotel plans to slash its work force by nearly 40 percent because of its upcoming $40 million renovation under a new owner, the Anekona Development Group.

Approximately 170 workers will be laid off in September, according to a state filing, as parts of the longtime Waikiki hotel are closed to accommodate its transformation into a more trendy, upscale property. About 450 employees work at the Ilikai, which was built in the 1960s by the late Chinn Ho.

The layoffs will take effect around Sept. 22, and it is not clear how long they will last, according to a warning notice the Ilikai sent to the state Department of Labor and Industrial Relations and Local 5, the union that represents Ilikai workers. "It is therefore difficult to know at this time if or when the current workers may be recalled," the notice said.

However, not all 170 workers, who are affiliated with the hotel's Yacht Harbor Tower, are likely to be laid off, said Cade Watanabe, spokesman for Local 5. Some might opt to take severance or early-retirement packages from Anekona, he said.

"Owners of the Yacht Harbor Tower are in the preliminary development of their renovation plans," said Teri Orton, general manager of the hotel, which has been renamed the Ilikai -- Where Waikiki Begins. "It would be premature at this point to comment on the time line for the start or completion of this project or the impact this would have on our staff."

The Yacht Harbor Tower, which houses the Angel Chapel, Tanaka of Tokyo restaurant and a small jewelry and gift shop called Heidi's, will be completely redeveloped with a third-party partner that has yet to be announced, according to a recent press release issued by Anekona.

Anekona Development bought the Ilikai earlier this month from Forward One LLC, a California-based company with ties to Taiwan, for upward of $200 million. Brian Anderson, a kamaaina developer affiliated with Anekona, said he wants to reposition the property to appeal to a younger clientele. Anderson is the son of D.G. "Andy" Anderson, owner of John Dominis restaurant.

As part of Anekona's renovations, some of the property's 703 rooms will be redeveloped into fee-simple condominiums. Anderson has used this development technique successfully during renovations at the Islander on the Beach on Kauai, the Kauai Beach Resort and the Luana Waikiki. The Ilikai condominium association currently has 586 members.

Local 5 is working with the Ilikai's new management to identify which positions are likely to be cut and to gather information on member benefits, Watanabe said.

"We have a responsibility to our membership to try and assist them in any way that we can," he said. "We need to make sure that they are educated about their rights and that they get answers to their questions about their health and welfare benefits."

Meanwhile, Local 5 is in contract discussions with the new owner, Watanabe said. The union's contract expired this month when Anderson and Anekona took control of the property, he said.